Supreme Court clarifies territorial jurisdiction in criminal cases: Kaushik Chatterjee vs. State of Haryana (30 September 2020)

Date of the Judgment: 30 September 2020
Citation: 2020 INSC 716
Judges: Justice V. Ramasubramanian
Can a criminal case be transferred simply because the accused claims the location of the crime doesn’t fall under the jurisdiction of the court where the case is filed? The Supreme Court of India addressed this question in a recent judgment, focusing on the nuances of territorial jurisdiction in criminal proceedings. The court clarified that while the location of the offense is a key factor, it is a matter of evidence to be determined by the trial court. Justice V. Ramasubramanian delivered the judgment.

Case Background

Kaushik Chatterjee, the petitioner, sought the transfer of three criminal cases from Gurugram, Haryana, to New Delhi. The cases were filed by his former employer, a non-banking finance company, where he served as Group Chief Risk Officer-Executive Director from August 4, 2016, to July 2018. The company alleged that during his tenure, three loans were sanctioned that later became subjects of complaints. The petitioner was initially based in Delhi from August 4, 2016, and later transferred to Mumbai on April 10, 2017.

The three loan accounts that led to the criminal complaints were:

• A loan to Zillion Infraprojects Private Ltd. sanctioned on October 26, 2016, for Rs. 4,30,00,000.
• A loan to Al-Fatah Tours and Travels sanctioned on September 22, 2019, for Rs. 71,50,000.
• A loan to Hotel M.S., sanctioned on December 30, 2016 and December 28, 2017 for Rs. 46,00,000 and Rs. 5,13,594 respectively.

The company lodged complaints with the Station House Officer, Civil Lines, Gurugram, leading to the registration of three FIRs.

Timeline:

Course of Proceedings

Following the complaints, the police filed charge sheets in all three cases. The petitioner then filed transfer petitions, arguing that the Gurugram court lacked territorial jurisdiction, as the loan agreements were executed in Delhi, Indore, and Surat, not Gurugram. The petitioner also raised concerns about bias, alleging that the complainant wielded significant influence in Gurugram. However, the bias argument was not pressed during the hearing.

Legal Framework

The judgment refers to several sections of the Code of Criminal Procedure, 1973 (CrPC) concerning jurisdiction of criminal courts.
✓ **Section 2(j)** of the CrPC defines “local jurisdiction” as the area within which a court or magistrate may exercise its powers.
✓ **Sections 177 to 184** of the CrPC outline the rules for determining the jurisdiction of criminal courts in inquiries and trials. These sections specify that an offense should ordinarily be inquired into and tried by a court within whose local jurisdiction it was committed.
✓ **Section 177** states that every offense should ordinarily be inquired into and tried by a Court within whose local jurisdiction it was committed.
✓ **Section 178** deals with cases where an offense is committed in multiple local areas or where there is uncertainty about the location of the offense.
✓ **Section 179** deals with cases where an act is an offense due to the act itself and its consequences.
✓ **Section 180** addresses offenses that are related to other offenses.
✓ **Section 181** deals with offenses like theft, extortion, robbery, criminal misappropriation, and criminal breach of trust.
✓ **Section 182** deals with offenses like cheating.
✓ **Section 183** deals with offenses committed during a journey or voyage.
✓ **Section 184** addresses cases involving multiple offenses of the same kind or in a series of acts.
✓ **Section 26** of the CrPC specifies which courts can try offenses under the Indian Penal Code (IPC) and other special laws.
✓ **Section 461(l)** of the CrPC states that if a Magistrate not empowered by law tries an offender, the proceedings shall be void.
✓ **Section 462** of the CrPC states that a judgment should not be set aside merely because the trial took place in the wrong local area, unless it caused a failure of justice.

Arguments

Petitioner’s Arguments:

• The petitioner argued that no part of the cause of action arose in Gurugram, as the loan agreements were executed elsewhere.
• The loan to Zillion Infraprojects was executed in Delhi, the loan to Hotel M.S. was executed in Indore and the loan to Al Fatah Tours and Travels was executed in Surat.
• The petitioner contended that the complainant deliberately filed the cases in Gurugram due to their influence in the area.
• The petitioner also contended that the de facto complainant did not have an office in Gurugram and had committed perjury by claiming otherwise.

Respondent’s Arguments:

• The respondent argued that the question of territorial jurisdiction is a matter of fact to be established by evidence and cannot be decided in transfer petitions.
• The respondent contended that the property offered as security for the loan to Zillion Infraprojects was located in Gurugram.
• The respondent also stated that they were sharing office space with a 100% subsidiary company in Gurugram.
• The respondent further argued that the borrowers, who are the main accused, have not sought a transfer.

The learned Standing Counsel for the State of Haryana supported the arguments of the respondent.

Issues Framed by the Supreme Court

The primary issue before the Supreme Court was whether the criminal cases should be transferred from Gurugram to New Delhi due to a lack of territorial jurisdiction.

Treatment of the Issue by the Court

Authorities

The Court considered the following authorities:

The Court also considered the following legal provisions:

Judgment

How each authority was viewed by the Court?

• The Supreme Court relied on Abhiram Veer Vs. North Eastern Regional Agricultural Marketing Corporation Ltd. [2000 (10) SCC 433]* to support the proposition that the question of whether any part of the cause of action arose within the local limits of a court’s jurisdiction is a question of fact to be established by evidence and cannot be gone into in transfer petitions.
• The Supreme Court relied on Asit Bhattacharjee Vs. Hanuman Prasad Ojha & Ors. [2007 (5) SCC 786]* to support the argument that the issue of territorial jurisdiction is a matter of fact that should be decided by the trial court.
• The Supreme Court referred to State of Uttar Pradesh Vs. Sabir Ali [AIR 1964 SC 1673]* to discuss the implications of a trial by a court not empowered by law, highlighting that such proceedings are void.
• The Supreme Court discussed Ramnath Sardar Vs. Rekharani Sardar [(1975) Criminal Law Journal 1139]* to explain that an objection to the territorial jurisdiction of a court must be dealt with by the Magistrate when raised.
• The Supreme Court cited Raj Kumari Vijh Vs. Dev Raj Vijh [AIR 1977 SC 1101]* to distinguish between the jurisdiction of a court to try particular kinds of offenses and its territorial jurisdiction, noting that the latter is a matter of convenience.
• The Supreme Court referred to Purushottam Das Dalmia Vs. State of West Bengal [AIR 1961 SC 1589]* to explain that there are two types of jurisdictional issues for a criminal court, one relating to the power to try particular kinds of offenses and the other relating to territorial jurisdiction.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the principle that issues of territorial jurisdiction in criminal cases are fact-dependent and must be resolved through evidence presented before the trial court. The Court emphasized that it cannot make a determination on territorial jurisdiction in a transfer petition, especially when factual disputes exist. The Court also noted that the issue of territorial jurisdiction is a matter of convenience.

The court’s reasoning was based on the following points:

• The issue of territorial jurisdiction is a matter of fact that needs to be established by evidence.
• The rules relating to territorial jurisdiction are laid down in Sections 177 to 184 of the CrPC.
• The court cannot make a determination on territorial jurisdiction in a transfer petition.
• The trial court is bound to consider the issue of territorial jurisdiction.

The Supreme Court quoted the following from the judgment:

“While jurisdiction of a civil court is determined by (i) territorial and (ii) pecuniary limits, the jurisdiction of a criminal court is determined by (i) the offence and/or (ii) the offender.”

“the issue of jurisdiction of a court to try an “offence” or “offender” as well as the issue of territorial jurisdiction, depend upon facts established through evidence”

“it is open to both parties to raise the issue of territorial jurisdiction, lead evidence on questions of fact that may fall within the purview of Sections 177 to 184 read with Section 26 of the Code and invite a finding.”

Key Takeaways

• Territorial jurisdiction in criminal cases is a matter of fact that must be established through evidence.
• The trial court is responsible for deciding on issues of territorial jurisdiction based on the evidence presented.
• Transfer petitions are not the appropriate forum to resolve disputes about territorial jurisdiction when factual disputes exist.
• The convenience of the parties and witnesses is a factor in determining territorial jurisdiction.

Directions

The Supreme Court directed that it is open to both parties to raise the issue of territorial jurisdiction before the trial court, lead evidence on questions of fact, and invite a finding.

Development of Law

The ratio decidendi of this case is that the issue of territorial jurisdiction in criminal cases is a matter of fact that must be established through evidence before the trial court, and cannot be decided in transfer petitions. This judgment reinforces the existing legal position and does not introduce any new principles.

Conclusion

The Supreme Court dismissed the transfer petitions, holding that the issue of territorial jurisdiction is a matter of fact that must be decided by the trial court based on evidence. The court clarified that such issues cannot be resolved in transfer petitions. The judgment reinforces the importance of factual evidence in determining the jurisdiction of criminal courts.

Category:

• Criminal Law
  • Territorial Jurisdiction
  • Code of Criminal Procedure, 1973
    • Section 2(j), Code of Criminal Procedure, 1973
    • Section 177, Code of Criminal Procedure, 1973
    • Section 178, Code of Criminal Procedure, 1973
    • Section 179, Code of Criminal Procedure, 1973
    • Section 180, Code of Criminal Procedure, 1973
    • Section 181, Code of Criminal Procedure, 1973
    • Section 182, Code of Criminal Procedure, 1973
    • Section 183, Code of Criminal Procedure, 1973
    • Section 184, Code of Criminal Procedure, 1973
    • Section 26, Code of Criminal Procedure, 1973
    • Section 461(l), Code of Criminal Procedure, 1973
    • Section 462, Code of Criminal Procedure, 1973

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